 Developments in the amendment of the Arbitration Act The amended Arbitration Act was announced on May 29, 2016. It is the first time in 17 years that the Arbitration Act has been amended in its entirety. The arbitration system is used to settle disputes quickly, at a reasonable cost, in a professional and future-oriented manner. It does this utilising the services of a judge who is appointed with the consent of the parties to the arbitration. Increased use of arbitration enables courts to reduce massive workloads, freeing up judicial resources for other important cases. Additionally, as international transactions increase, so do international disputes. Arbitrations provide added value as an effective means of resolving disputes between parties located in different countries. Consequently, many countries around the world are investing in attracting international arbitrations and realigning relevant laws and regulations to facilitate this increasingly utilised dispute resolution method. Korea is no exception. Details of the amended Act Simplified recognition and enforcement of arbitral awards (Amended Act, Article 37) Before the amendment of the Act, an arbitral award needed to be subjected to an adversarial trial process before it could be reduced to a judgment, so that execution could take place on the award. In contrast, the amended Act makes it possible to enforce an arbitral award by a decision of the court alone, without the need for a full adversarial litigation process. This is the most critical of changes. In addition, the amended Act has simplified the types of documents necessary for the recognition and execution of an arbitral award. In many cases these changes will ensure more rapid recognition and execution of arbitral awards.Interim relief availability (Amended Act, Articles 18 & 18-2 through 18-8) Before the amendment of the Act, an arbitral tribunal was permitted to take only interim measures that were deemed necessary in connection with the “subject” of the dispute, and no enforcement mechanism was established. Consequently, interim relief was rarely available. Conversely, the amended Act specifically permits an arbitral tribunal to issue orders for “maintenance and restoration of the present state”, “action to prevent existing or impending risks in the arbitration process itself”, “conservation of assets being subject to enforcement” and “conservation of critical evidence relevant to dispute resolution”. It also provides that interim measures ordered by an arbitral tribunal may be enforced by the courts. This change is expected to fuel frequent use of interim measures in arbitrations. Other details Impact of the amendment of the Arbitration Act ––––––––––––––––––– |
Amendment of the Arbitration Act
